Top Traders Unplugged26 Okt 2021

VOL01: The New Nature of Stock Market Movements ft. Hari Krishnan

Today Jason Buck is joined by Hari Krishnan in the first of our series on Volatility. Topics discussed include: the benefits of adding volatility strategies to your portfolio, why it can pay to avoid hedging when the crowd is already doing so, explaining the 'Put slingshot', how markets are different today from decades ago, protection against tail-risk, the psychology behind large markets sell-offs, and some thoughts on the effects of leverage on the markets.

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50 YEARS OF TREND FOLLOWING BOOK AND BEHIND-THE-SCENES VIDEO FOR ACCREDITED INVESTORS - CLICK HERE

In this episode, we discuss:

The benefits of tail-risk hedges / adding volatility hedges to your portfolio
The importance of avoiding group think (in hedging)
Some thoughts on what is known as the ‘Put slingshot’
The new nature of stock market movements
The repricing of risk during fast downturns
Tail-risk protection versus Trend Following
How tail-risk protection can complement an existing allocation to Trend Following
Some of the psychology and mechanisms behind large and sharp market moves
How positioning and leverage end up creating challenging markets to trade in

Follow Niels on Twitter, LinkedIn, YouTube or via the TTU website.

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And you can get a free copy of my latest book “Ten Reasons to Add Trend Following to Your Portfolio” here.

Learn more about the Trend Barometer here.

Send your questions to info@toptradersunplugged.com

And please share this episode with a like-minded friend and leave an honest Rating & Review on iTunes or Spotify so more people can discover the podcast.

Follow Jason on Twitter.

Follow Hari on Twitter.

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Episode TimeStamps:

00:00 - Intro

02:59 - Why should somebody include volatility or tail risk into their portfolio?

04:35 - Do you think rolling option puts is a good hedging strategy?

07:47 - The tradeoffs between near-term and long-term option pricing

09:03 - Can you explain the differences between ‘Gamma’ and ‘Vega’ options profiles?

10:15 - What are your thoughts on rolling options?

15:05 - How do you think about the timing of adding and removing volatility protection?

18:27 - In your book you mention the ‘Sombrero Trade’, can you describe what this is?

21:54 - How risk becomes repriced during sharp selloffs

25:04 - Does tail-risk protection help long-term Trend Followers?

25:04 - Are you looking out for inflection points such as in March 2020, where everybody ran for the exits at the same time?

43:15 - What are your thoughts on the huge amounts of passive inflows to the markets and the inelasticity it creates?

49:08 - What about the those who say the Federal Reserve (the ‘Fed put’) is the ultimate protection and therefore no other protection is needed?

54:10 - How do you think about those funds who use ‘vol targeting’?

01:01:12 - How do you think about ETFs when it comes to ‘whales’ positioning?

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PLUS: Whenever you're ready... here are 3 ways I can help you in your investment Journey:

1. eBooks that cover key topics that you need to know about

In my eBooks, I put together some key discoveries and things I have learnt during the more than 3 decades I have worked in the Trend Following industry, which I hope you will find useful. Click Here

2. Daily Trend Barometer and Market Score

One of the things I’m really proud of, is the fact that I have managed to published the Trend Barometer and Market Score each day for more than a decade...as these tools are really good at describing the environment for trend following managers as well as giving insights into the general positioning of a trend following strategy! Click Here

3. Other Resources that can help you

And if you are hungry for more useful resources from the trend following world...check out some precious resources that I have found over the years to be really valuable. Click Here

Disclaimer

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